Arnold: State Losing $470 a Second

State in budget crisis

Wednesday, Dec 10, 2008  |  Updated 2:09 PM PDT
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Arnold: State Losing $470 a Second

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Gov. to Lawmakers: Don't anybody go anywhere!

Gov. Arnold Schwarzenegger called a last minute news conference Wednesday and said he is ready to work through Christmas in order to fix the state's crumbling budget problems.

Talking tough, he said he's frustrated by lawmakers "shameful performance."

Schwarzenegger said the state is currently losing $470 a second.

A clearly frustrated Schwarzenegger called on the so-called "Big 5" legislative leaders to meet this week, and called the state Legislature's failure to act so far a "shameful performance."

"We are heading towards a financial Armageddon. We can already see it coming," Schwarzenegger said.

Schwarzenegger says California's budget shortfall has grown to $14.8 billion for the current fiscal year. That's $3.6 billion higher than the shortfall legislators already have been unable to solve.

The governor declared a fiscal emergency last month and called a special session of the new Legislature to address the growing gap. The deficit then was estimated at $11.2 billion.

"What is amazing about all of this is that the Legislature acts as if we have $30 billion of surplus," Schwarzenegger said. "They met, they debated, they postured and they did nothing."

The state treasurer, controller, nonpartisan legislative analyst and the governor's finance director addressed a rare joint session of the state Legislature Monday to warn lawmakers about the dire consequences of doing nothing. State Controller John Chiang has said California could run out of operating cash by February.

Assembly Speaker Karen Bass, D-Los Angeles, left the next day for Washington, D.C., to appeal to the incoming administration of President-elect Barack Obama for federal assistance for California. Assembly Minority Leader Mike Villines, R-Clovis, was also there Wednesday.

Schwarzenegger said he wanted a meeting of the Big 5 in the state Capitol Thursday and said he also plans to meet with individual lawmakers.

He wants a combination of spending cuts and tax increases. So far, Republicans and Democrats have failed to reach a compromise.

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